I hope someone is familiar with rotation sensors, I was looking at this one http://www.robotshop.com/ProductInfo.aspx?pc=RB-Dfr-43I wanted to know how the connections consisted of, I guess the metallic shaft needs to be moved by something else? And do you need any other components to set it up with breadboard?And how would this one work? this is an encoder based one http://www.robotshop.com/phidgets-rotation-sensor.htmlI want to use this with a dc motor. Any ideas would be helpful, as I do not have any background in sensors whatsoever.

Both of the sensors you have linked are potentiometers. The first allows 10 turns of rotation and then stops. The second can only be turned within a 300 degree arc. If that fits your requirements then the potentiometer tutorial has all the information you need.

Without knowing your specific application it is hard to say. As mentioned above, your examples would not work for continuous rotation. The following encoders have ease of integration as they 'snap' on to existing shafts: http://www.cui.com/Catalog/Components/Encoders/Incremental_Encoders/Modular

I am using this to detect if a dc motor has slowed down when it's supposed to be rotating, or if it has stopped completely. Yeah i read the specs for the potentiometers and they won't spin continuously, good point. In this case the encoder will spin continuously and detect a slow down or stop? Any other sensors that can do this? or any other method?

If you do not care about direction, a pulse wheel encoder (rather than quadrature) would be a less expensive option. Also a simple hall sensor setup a'la bicycle speedometer or gear tooth sensor might work for you.